Walleye unlikely to go from ECHL to AHL

5/6/2012

BY RACHEL LENZIBLADE SPORTS WRITER

Fans pack the Huntington Center for a Walleye game. Although Toledo ranks high as a minor league market, its immediate chances are slim of competing in the American Hockey League, hockey's equivalent to Triple-A baseball.

Toledo has been almost a mainstay as a minor league hockey market since 1947, when the Mercurys began play in the International Hockey League.

The Walleye have qualified for the ECHL playoffs once in their first three seasons, and Toledo has averaged more than 6,000 fans a game in its first three seasons at the Huntington Center. Last year, Sports Business Journal named Toledo as the No. 13 minor league market (of 241 markets) in the nation.

In three years of playing in two minor league markets, one notable thing has stood out to Alec Richards about playing in Toledo: the appreciation of the fans for the product on the ice.

"I've seen it first-hand here," said Richards, a goalie who also played for Rockford of the American Hockey League. "It's great, and it's fun to play in front of a knowledgeable crowd."

At first glance, the elements are in place for the Walleye to potentially make a jump from the ECHL to the American Hockey League, the top North American proving ground for the National Hockey League.

Transitioning from an ECHL team to an AHL team is not an arbitrary decision by organizations and their ownership, or by either league. It takes a certain set of circumstances to make that transition, including finding a suitable parent club in the NHL and being able to fulfill an AHL vacancy if it is available.

The Walleye's private, not-for-profit ownership group purchased the franchise from the owners of the Toledo Storm, which was struggling financially, and considered AHL membership during two seasons of dormancy from 2007-09. The ownership elected to join the ECHL, which was originally known as East Coast Hockey League but changed to just ECHL in May, 2003.

Joining the AHL is still a possibility, but a far-fetched one at this point, as the AHL's membership is currently capped at 30 teams.

"Right now, I think we're pretty comfortable that we're going to be in the same 30 markets that we were in last year," said Jason Chaimovitch, the AHL's vice president of communications.

Toledo Arena Sports, Inc., chairman Mike Miller said that Walleye ownership has and would continue to examine AHL ownership opportunities, but acknowledged that AHL ownership comes with higher annual operating expenses. An NHL organization's AHL farm team is responsible for player salaries, workers compensation and travel expenses. (By comparison, Major League Baseball organizations absorb the cost of minor league player and coaching salaries and compensation, as well as worker's compensation.)

In addition, joining the AHL costs an ownership group a $3 million entry fee, as opposed to a $500,000 ECHL entry fee, and a larger debt gap would mean consumers make up the difference in the form of higher ticket prices, higher food and beverage prices, and higher souvenir costs.

"We have to proceed with the perspective of, you have to purchase it, operate it, and maintain it successfully," Walleye general manager Joe Napoli said. "Looking back, there's a rich tradition of following hockey here. But all of the franchises that have folded, they've folded under the pressure of making ends meet."

The Walleye stepped onto the ice at the Huntington Center in the fall of 2009 -- Richards' first season of pro hockey. But the Walleye's first season on the ice came at the tail end of a time of transition in the ECHL.

In December, 2008, ECHL franchises in Augusta, Ga., and Fresno, Calif., folded, two of 40 franchises that have folded in the league's 20-year history.

"The horrific economy and the resulting decrease in revenue from season tickets, corporate sponsorships, and overall attendance has created a situation this year which is not sustainable and we simply cannot continue to operate," Fresno managing general partner Chris Cummings said in a statement from December, 2008.

At that time, the Toledo ownership group prepared to return it to the ECHL as the Walleye. At the time, Napoli said the challenge the organization faced was in going from a franchise with significant financial losses to one that would break even.

"We could not have run the franchise at a loss," Napoli told the Blade in 2008.

Four years later, under a not-for-profit model, Toledo Arena Sports, Inc., has liquid reserves that allow either the Walleye or the Mud Hens to take a financial loss -- though Miller said the organization has not taken a loss in four years. Miller said a not-for profit ownership group "would certainly work in the AHL."

"We have to approach things as, how do we make it affordable?" Napoli said. "How do we embed this in the community?"

There are other variables that factor into a transition from the ECHL to the AHL: geography, ownership changes or stability, an organization's philosophical approach, and how it meshes with an NHL parent team.

"The affiliation agreement is key," said Tera Black, the chief operating officer of the AHL's Charlotte Checkers. "You have to have a good relationship with a parent club."

Even community support factors into making the decision to take the leap from the ECHL to the AHL.

That's even before anyone factors the consideration the visible product -- the team on the ice.

The Walleye has two parent NHL teams, the Detroit Red Wings and the Chicago Blackhawks. The Walleye are also the feeder team for those teams' AHL affiliates, the Grand Rapids Griffins and the Rockford Ice Hogs, and the Walleye struggled with little roster stability, as a result of constant call-ups to the AHL and injuries. At certain points in the 2011-2012 season, Walleye coach Nick Vitucci wasn't just organizing the team on the ice -- he was also making phone calls and scouting to find prospective players to fill holes on the Walleye roster.

This past season, 52 players made up the Walleye roster, including seven goalies. Of those players, only two played in all 72 games. By comparison, 36 players (including four goalies) made up Grand Rapids' while 31 players (including three goalies) made up Detroit's roster, whose active-player roster has a 23-player limit.

"You'd have to be with a great NHL organization that has to be respectful of your challenges," Vitucci said. "We've had an unstable roster and we don't have the luxury of a feeder league below us, like what we do to provide for the AHL."

A move to the AHL for the Walleye would be about the bottom line and about a symbiotic relationship between the parent and farm teams.

"It would be more about dollars and cents," Miller said.

"Organizations can change, too. You want something that's sustainable. When you get a different management team in an organization, it can change the complexion of things."